>> live from new york where business never sleeps this is squawk box. >> good morning, everybody. welcome to squawk box. this is cnbc. i'm becky quick with joe kernen and andrew ross sorkin. we're listening to the foo fighter. they're reprising the song they played for the late night host when he returned after bypass surgery. he introduced foo fighters as my favorite band playing my favorite songs. let's get you up to speed on the markets. the futures this morning at least at this point look like we're barely budging at this point. nasdaq off by 14 and the s&p futures down by 4.5 points. this is all coming the day after the release of the fed minutes and yesterday over the last several days we have not seen very significant moves in the markets one direction or the other.

markets slightly weaker yesterday. >> a couple of big stories this morning. the big one is hp reportedly planning to sell a majority stake in it's chinese data networking operation for about $2.3 billion. heres what's going on. the wall street journal saying it comes after revelation that u.s. spying for demand for tech products. sis coe and others have had issues about this. also in economic news new numbers overnight showing chinese factory activity contracted for a third straight month. chinese output shrinking at the fastest rates in more than a year. this is going to reinforce expectations for more policy stimulus. geo political headlines this morning, isis saying it's in full control of the ancient sere juan city of palmyra. >> here's today's squawk planl. key economic reports. weekly jobless claims later in

the morning. manufacturing pmi. existing home sales. leading economic indicators in the kansas city fed survey. on the earnings front best buy will report quarterly results before the bell anything from january to april i guess. this afternoon we'll hear from hewitt and gap. mcdonald's is holding a meeting. it will make it easier to nominate directors to the board. >> a couple of stocks to watch this morning. data storage equipment missing the market also sales force beating the street and raising it's revenue forecast for the full year. company of course in the middle of all kinds of speculation on a takeover and we'll talk to an analyst in about 15 minutes from now. also victoria secret's parent call posting better than expected earnings but revenue

did fall a bit short and we should tell you that william sonoma reported earnings and revenue ahead of estimates but it's current guidance is cautious but it's in part because of the west coast sport slow down. >> let's take a look at the markets this morning. the future is under a little bit of pressure this morning. the dow futures down by 33. s&p down by 5 and nasdaq down by 14. at this hour you're going to see not significant moves but they're both down by one third of a percent. in asia overnight we saw what happened following tight and narrow trading ranges here for the fourth day in a row. you can see that -- we'll take a look at asia in just a bit. in the meantime let's take a look at oil prices. yesterday you actually saw oil snapping a five day losing streak. it settled up by about 1.7%. this morning it's up another 67

cents to 5965. so getting close again. check out what's been happening in the bond market. the ten year note yielding 2.237% in the currency markets. right now the dollar is down across the board. euro trading at 1.1143. sorry, joe. dollar yen at 121.02. >> it's headed to 105. on its way to 95. >> well in the next six weeks, correct? finally let's take a look at what's been happening in gold market yeah gold prices barely budge. the chances of an interest rate hike in june are looking slimmer and slimmer after the latest fed minutes. the markets responding with a short spike before settling mixed for the day. now that the june question is mostly behind us are we looking at september or even december for the fed to make a move?

he's the director of global macro at fidelity investments. he's the cio. what did you think of what the fed said yesterday. >> good morning. >> good morning. >> no surprise. june was off the table stars the markets were concerned. they would have signalled something if they were away from where the market priced things in. september, december it's looking more like december. so really no surprise there. >> no surprise there. the immediate reaction was a slight sell off for stocks at least. why? what did the market see it didn't like? >> i didn't see anything surprising. so i think it's just noise. >> michael how about you. if the fed is looking like it's standing at this point there was a little bit of perhaps tougher talk in there just to appease some of the hawks. what did you think? >> the fed is in no hurry because they don't need to be. the things they look at are

still problematic. at least at the macrolevel. corporate america is doing well. the overall sense of the economy is doing well but the problems are some what transitory in the first quarter. the fed wants to see consistency in the economy and so far they haven't. they're going to continue to be patient. >> do you think they will get consistency to the point where they feel comfortable with this? it's starting to feel like a broken record. >> it does. this is the same as we saw last year and we'll see a surprisingly strong second quarter rebound. particularly as the supply trains gets straightened out from the port issue in the west coast and we'll see third quarter and fourth quarter start to stabilize. unless we have surprising disruptions toward the end of the year we should see the stability and consistency that the fed wants. >> the one difference is this time around the jobs market looks a lot stronger s. that enough to give the fed the confidence to do this even while you're watching other central

banks get into quantitative easing at this point. >> yeah the u.s. economy remains in mid cycle expansion territory. hasn't been overly robust but that's not a bad thing. it keeps the fed at bay, keeps them in no hurry to do anything drastic. >> what do you do as an investor? is the u.s. the place to be or are these overseas market looking better because of what the central banks are doing? >> we have a global reinflation. even with the fed not doing qe but now holding off on the lift off. we have a pretty global environment of reinflation going on. it's interesting the s&p is making steady new highs. not in a dramatic way but steady new all time highs and we don't hear much fanfare about it. >> you were really a money manager. you said we're in this mid cycle recovery which is pretty tepid which is a good thing because it

keeps the fed out. if we could just stay here forever you'd be fine but let's just say sub 2% keep the fed at zero and never grow again in this country and you'd be okay with that? >> look we can grow at 5% and have the fed raise rates. >> oh, no, 5% and the fed raise rates. >> then you get to the end of the cycle quicker or you can grow 2.5%. >> that is proverse. it's proverse logic to say thank god we're not growing much in this country so that the fed can stay at zero. >> ultimately the cycle ends with successes the fed has to respond to. >> i hope they come in my lifetime and i'm getting up there and so are you. >> if we stay in the sweet spot longer it gives the economy a longer time -- >> sweet for you. it's not sweet for most americans. >> well it is what it is but the economy has been growing about 2.2% since '09 and it's better

than the alternative. it's not going to be 5% but it's better than zero. >> the question comes back to is there any down side for the fed keeping rates so low? there's people skeptical of this and none of the bad stuff happened yet but does that mean it won't? >> they have to be prepared for what happens when the cycle ends and right now they aren't. that is one issue but the other issue is that in fact if the rest of the world is continuing to ease they do run the risk of if they tighten too quickly the dollar gets too strong and that does put the breaks on the economy at a time when frankly although the job's headline numbers are pretty good you get into the details we're not doing too well. we have too many low skilled jobs and not enough high skilled jobs coming through. how long people are out of work

so the economy is not completely fixed yet although the market is still far along in that. >> you would still be telling people to invest in u.s. equities? >> there's nothing wrong with the stock market right now but having said that there may have been more opportunities outside the u.s. where the monetary authorities are finally beginning to do the things the fed did several years ago and that is helping a global inflation and european and japanese and other economies finally get going. >> if you were to tell someone where you thought they were best positioned to place their money, if it's in the united states which sectors would you be focused on? >> well, sort of the yield sectors were really big last year. rates, utilities, those have taken a backseat now with yields rising. the ten year went to 2.3 now. we all know the story in germany where bunds rose from 5 basis

points to 75. so yields backed it up and maybe there's an opportunity now that we have a flash crash in the bond market and it tends to effect the yield oriented place in the bond market as well. there's an opportunity to grab on to some yield that wasn't available a few months ago. >> okay. great. i want to thank you both for joining us this morning. >> thank you. >> almost as if the stock market has gone up a lot. i like it when it goes up. but if you knew that it wasn't going to help the economy, and people feel more confident and actually boost the middle like it's supposed to -- if all you knew is that wealthy people were going to continue to get wealthier and wealthier you'd have to say enough is enough. the people that own stocks have benefitted enough.

>> i've been quite. he's doing the work for me. >> the inequality is a huge issue but this is the hand we have been dealt. >> that may not be true. that may not be true that that's the hand we have been dealt. >> but the fed can't solve it. the fed isn't going to be able to resolve it. >> you need to get into fiscal policy, highway bills things like that. >> i don't, i think you need to get into growth policies. >> but in either event it's not the fed that controls that. >> we're not saying we need to dig holes and fill them back up. >> at 5.5% unemployment we're probably nearing the point where -- >> is that a real number though with 60%. >> it's higher. >> 30 hour work weeks. >> but we're inching aalong to the point where the fed has to start looking at the inflation component of the unemployment

sector and if we start growing by laeps and bounds that's great but it also brings us closer to the end points. >> i don't like fridays because they're too close to monday. i like thursday best. so we don want any growth because it may be close to the end of the growth. so let's not have growth so we don't have to look at the end of it. >> we want growth but we don't want overheating. >> but 5% might be overheating. 3 is not. >> i mentioned 5%. i didn't mention 3. so i'll take 3. i think the fed will take three happily. >> i'd take 5 for a couple of years i think. i don't know. >> thank you for being here. coming up a rand paul filibuster on the patriot act. plus david letterman bringing the jokes. but first, here's a look back at this date in history. ♪

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in washington today the senate is expected to start talking about a bill to replace the patriot act despite a marathon speech that almost lasted all night. nbc's tracie potts is live on capitol hill this morning where senator rand paul just stopped talking just a few hours ago. hopefully tracy, you din have to listen and watch the entire time did you? >> no i did not have to sit through the whole speech and neither did a lot of people on

capital hill actually. we thought it was going to go through this morning. turns out it didn't but the situation now the house has passed the usa freedom act to replace the patriot act. they're supposed to be leaving today so it's up to the senate to do something. we're expecting debate on that to start later today after that very long speech overnight. >> i will not let the patriot act, the most unpatriotic of acts go unchallenged. >> it went on. >> i think we can obey the constitution and catch terrorists at the same time. >> and on and on and on. >> my voice is rapidly leaving. my bedtime has long since passed. >> with demonstrations outside and help from conservative republicans and liberal democrats inside senator rand paul spoke for 10.5 hours finishing just before midnight. >> i relinquish the floor. >> not technically a filibuster

and not long enough to postpone what is expected to be today's debate on the usa freedom act. >> it will make it look more like the courts that americans deal with in other walks of life. >> what done make sense is to be pursuing approaches that don't make us safer and compromise our liberties. >> the house passed the freedom act as an alternative allowing phone companies not the government to keep your records. but some senators want to hold on to the patriot act. the patriot act expires june 1st. >> now, here's the thing. if it expires and congress isn't here and they haven't made a decision nsa may have to shut the program down quickly which they can't necessarily do overnight. so the guidance from the justice department to the nsa is that they stop collecting those phone records pretty soon after tomorrow in case there's no

resolution here on capital hill and they have to shut it down within the next week. >> okay tracy, thank you. i remember -- we remember two guys that have used that recently right? >> recently? i was going to go back to mr. smith. >> and i'm not even saying that because i think he lizelizabeth sanders and warren watched and they saw jimmy stewart and he finally collapses and it's like he's a hero and, you know what i mean. and then it's a wonderful life. who done like him in it's a wonderful life? so they saw that and given the opportunity i think they both wanted my voice is gone. it's past my bedtime. exactly and the flag of mr.

smith. it's weird again. you have cruz and rand paul and then far left on the patriot act. >> that's how it is. >> and then in the middle -- very weird. that shows you time space continuum. it does wrap around. you go far enough on each side and you end upcoming here. >> we'll ask chris christie about that. >> he talked about the patriot act. see i worry about what you're doing with some of your personal information. i wouldn't want that getting out either but i'm an open book. if you can stop a terrorist, look at everything. >> i'm open. what are you crazy. >> nobody wants all of their e-mails read. >> i've always said read it all. read it all. >> what about the e-mails coming directly from paul telling you the talking points and all. >> you already exposed me. not a lot to do there. in media news some of the biggest names in sports gathering for the sports business journalism award last

night. among the issues the ever changing media landscape so we asked these power players about the rise of live streaming apps like merecat and periscope. >> to me it's robbery. to me it's theft. >> it's a free market and the free market is going to work itself out in the way it does but the more people able to access the content of the sports in my opinion as an athlete the better. >> there's a difference between fan engagement and commercial exploitation and while some people may think that's a fine line it's one we're going to have to be prepared to draw. >> for the leagues that do it right they'll be able to capitalize on that but if that's cutting into your television profit you have a problem. >> for football are you really willing to just watch it on one guy's cell phone? i think that's a little bit of a reach. >> we talk all the time about the value of sports and there are just a few people that have

seen it firsthand. after 33 years in late night david letterman signed off for the last time. the night was a star studded event complete with appearances from four presidents. the final show included a top ten list read by some of dave's most memorable guests from alec baldwin to tina fey to bill murray. >> they said when did you know it was time to retire? there's signs. there were always signs along the way. one of the signs was todd came up to me and said for the love of god dave i can't write the words any bigger. do you remember remember that? okay. all right. fine. all right. >> letterman's final sign off was simple. thank you and good night. we'll talk to long time letterman executive producer rob burnett. he will be in studio at 8:30 a.m. eastern time. >> salesforce beating the street raising it's full year guidance. is the buzz dying that the cloud

computing company is up for. acquisition ceo joined jim cramer yesterday to address the company's future. >> don't you find it ironic that your stock is traded within a dollar of when oracle, microsoft, ibm were supposed to be buying you? >> i'd be a lot more excited when we announce with you on the show that we're the fastest to 10 billion. today i'm saying we're the fastest to 6 billion. for me that's the past. i'm all about the future. >> let's speak with kirk the managing director of equity research. has a buy rating and raised his price target and looks complete completely different than who we just saw. weird. >> weird. >> i know that other guy. it's like there's two universes. >> that's the one. >> we're close because he's here. >> right. >> anyway, are you going to tell

us anything andrew hasn't told us about salesforce? >> i think we have been pretty consistent that the odds of it happening are low. the complexity of growth based mna and software is challenging. this is a huge deal. there's a few buyers that could afford it financially and the number of buyers that koul culturally -- could culturely fit them is challenging. you look at google if they wanted to bring on an enterprise arm of its business that's a huge undertaking. if you can't keep the people you're acquiring it doesn't make sense to go out and do this kind of deal. >> you think fundamentals can continue to push the stock higher and you look at price to

sales or anything? is it just me? hasn't it run up on acquisition stuff. >> the price to sales is now like six times. but it's not a cheap stock. there's very few large cap growth companies growing at 25% in constant currency with expanding margins and there's very few companies out there that has the breath of product portfolio that salesforce does so i think there's still reasons. this is what the quarter told us last night. there's a reason on the fundamental basis. >> we keep bringing up uber evaluations and it's not just private companies. tech is really hot again. >> but arguably sales force makes real money. >> what's your number for the quarter? 16 cents? 17 cents. and they put up you know 730 million in operating cash flow last year. that was up 54% so now you have

a company that's not only growing very quickly. >> less than a dollar a year and selling at 7. >> but it's cash flow because it's subscription models well ahead of its earnings power. most are looking at the cash flow generation capabilities and what you saw was operating margins up 200 basis points. cash flow up 54% year over year. you're seeing a company not only growing it's top line very quickly but you're seeing leverage in terms of driving more cash flow in the bottom line. >> can can we just talk briefly to the extent we want to talk about the speculation around mna on this. this company has been up for grabs for like five years. sort of every six months to a year, this has probably been the most in terms of noise around it but to the extent somebody does take it out -- do you think there will be a time -- do you think in the next five years this is still an independent company? >> i think the path to those guys getting to 10 billion as an

independent company is pretty clear. mark was very clear on the conference call and on the show. when growth starts to come down and you see the culture so it wouldn't be as much at odds with one another you can see that. what you've seen in technology is there's been a lot of mature companies a inquired. you squeeze out the cost. those deals can work. they've done an incredible job with that. >> the bar is high on both but the buyer and the seller he won't want to sell and someone won't want to inquire them. >> it's very complicated to bring a growth business into a tech business. they work there for a reason. they want to be in a fast moving, fast based company. the buyers of sales force or outside of google would be more mature at this point in time. the stages of maturation of the buyer -- >> would a microsoft or ibm or

oracle be rewarded for buying a company like this or do you think they would get dinged? >> i think dinged. if you think strategically about microsoft and salesforce there's a pretty interesting scenario you can put together with the office productive tools with the success platform. there's interesting scenarios around that but i think in the near term the investor base are very differ investors. you have a value based investor in microsoft and more growth base investor in sales force. >> thank you. >> thank you. >> appreciate it. >> all right. when we come back if you are like most of us you spend a lot of time checking e-mail outside the office but now some are asking if you can sue your employer for making you answer late night notes. we'll get tho that next. but first a look at yesterday's s&p 500 winners and losers. ♪

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♪ >> welcome back. we're in the shares looking at stories fascinating us this morning and the one fascinating me is one about e-mail. so many of us get e-mails from all times of the day from bosses even late at night. should we be paid for or get

overtime or maybe comp time for responding to these e-mails late in the evening or in this case should we sue because we're not getting overtime. >> one of the cnbc suits sent me one at 6:45. >> yeah pm. >> the nerve. >> so late. >> and i was brushing my teeth. >> you had to respond. >> i had the night shirt on. i'm not responding at 6:45. are you out of your mind. >> past your bedtime. >> did you call your lawyers? >> i kaul calledcalled him this morning. >> what do you make of this. >> late at night is different for us. >> i understand the constraints of people feeling like they're working all the time. but i also think these tools are the things that allow us to have more flextime. if you get flextime at work. if you can walk out early. if you can come in a little later, if you get the chance to be away i think they have been great tools because yeah i can leave early because i will

respond to those e-mails later. not everyone is in the same position. if you're in a regiment and you must be here for nine or ten hours during the day and you're going to work the rest of the time i can understand the concerns. most of us are salary dealing with this. >> but this is an hourly issue. >> couldn't you say i didn't get it. >> i didn't get the e-mail. >> just give you a heads up but if you're already asleep you got in trouble for not respond responding. >> most of these are about hourly workers. >> some of these are about people that are salaried. >> if you're an hourly worker you do understand. >> if you have to put in face time where you have to be in an office from 9 to 5 or 9 to 6, whatever the time is and you don't get the flextime during the day. >> 6 to 9. >> 6 to 9 in the morning like we

do its a long three hours. >> no if you're getting flextime for it it should be understandable. >> we should just recognize i think, compared to i talked to my dad about this stuff in the old days. >> so you talked to a lawyer about this. >> i have talked to a lawyer. >> and he will you know 20 years ago people western talking to people after 6 or 7 or 8:00. but we did lement the idea that he would send something to a client and you have two days of waiting time and now you're back a half hour later with their comments. >> i think it depends if you get the flexibility it's a fair trade off. if you don, then it's not. i took a look at zappos. did you know they have always been known for running things a little bit differently than other companies. they have taken big steps that have shaken up the corporate

culture. they were saying they really only wanted people that really wanted to work here. so they were offering buyout proposals. >> they make -- >> they sell shoes. this is really cool. >> i'm thinking of zippo. >> zappos is a shoe company. >> who buys shoes online. >> i do. once you know your size. you should see my closet. >> i'm afraid to think about it. >> we have to buy the things. >> i have those too. the raxcks for your shoes. they have also rekrenlycently gotten rid of all managers which is stunning for those in the work place. particularly those promoted to manager. they had done a good job and now they're expecting all workers to manage themselves and for the people that had been there and move tludd through the ranks and gotten promoted they're struggling with getting knocked back down.

>> zappo is owned by amazon right? >> i know there's a connection but i don't know. >> i want to know what jeff besos thinks. >> no one smokes anymore. >> you're back on zippo. >> zappos. >> can i just tell you really quickly that before you've all seen -- except for you, 2001 where the monolith or whatever it is. >> years ago. >> gives them the ability to make a tool in a fight so there's ways to do carbon dating exactly when the first tools were found. so there were some found now in kenya in volcano settlement which is really active in terms of dating and we can know they actually looks like they were others which are the prehuman

they're -- >> what are you talking about? promagnum. >> no, that's a man. this is prior to that and they found dating it back to 3.3 million years. the thing is its 700,000 years earlier than they thought -- >> the stone age actually began. >> we were using tools. and they looked at them and doesn't look like the scraps of rock were broken by accident. >> when they say tools. >> they're rudimentary. they're not use what they were used for. >> these were more sophisticated and they were discarded but lucy is the one we're most familiar with that was found. but then i just think, you know we think about our life and how important events happening in our lifetime are, not necessarily talking about global warming. but 700,000 years is the blink of an eye in recalibrating when

man either did or didn't use tools. 700,000 years is the blink of an eye. >> thank you for making us all feel so incigsignificant. >> it's the blink of an eye. especially when you look at trends based on 500 or 1,000 years. i love this stuff though. don't you. going back 3.3 million years. although that's not that long ago either based on it. >> long in our lifetime. in our memories. >> it's as long as this show seems sometimes -- >> on that note. when we return this morning, jordan's king abdullah. while some in the west see chaos he says business as usual in the middle east. a first on cnbc interview right after this. financial noise

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welcome back to squawk box this morning, the king of jordan sitting down with hadley gamble in a rare interview. she joins us this morning from the dead sea in jordan. hadley. >> good morning. so essentially what we have seen over the last few days the islamic state gaining ground in iraq and gaining ground in syria and the obama administration now sending much needed weapons to that country. they're finally playing ball but the question now remains how effective is that really going to be. one man that may have the answer to that is king abdullah of jordan. i asked him is jordan safe and are we going to see an end to those conflicts any time soon? take a listen. >> we have a history over many decades of jordan always being stable throughout the region whatever the crises are and you

have to remember with everything going on around us jordan has done extremely well. we've had growth of 3% over the last couple of years. we're expecting 4% over the next two or three. our reserves are the highest they have ever been and when we look at the region you mention syria and iraq. iraq has always been a strong market for us and i believe that the iraqi government and coalition forces are going to open the route this summer so that's again sort of a very strong market that's going to be reopened. >> in terms of the challenges here at home 20% of your population are refugees right now. you also have a water crisis and you're dealing with the fact that you are a net energy importer. how are you tackling those problems? >> definitely you know the challenge for 20% of the population being refugees 85%

are actually outside so that's a burden on the jordanian economy. almost 25% of the gdp is then a burden that we have to take care of when looking after the refugees and that does create a bit more of a challenge. however how do we offset that with the energy needs that we need? because of the lack of gas from egypt we had to move quickly. this is always being able to adapt to all the challenges that we had. that's why you're seeing a major investment in alternative energy. >> so talk about jordan's ability to adapt. this country reports 97% of its energy needs. that's quite a challenge for jordan and the king is looking at all options.

renewables wind solar and electric cars. he likes his tesla. he's saying i'm a soldier, i like gadgets and i love innovation. on the way to the dead sea we were seeing the stations for powering your tesla car. it's exciting times here in jordan and they seem to be going green. >> okay. hadley thank you for that interview. great to see you again. when we come back this is traditionally one of the busiest months of the year to climb everest but a massive deadly earthquake shutdown the mountain. we'll talk to a california based company that organizes climbs, when we return. [ male announcer ] your love for trading never stops. so open an

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welcome back to "squawk box." hundreds offed a ed aadventure. ists could be in danger and avalanche last spring that killed 19 sherpas on the mountain. adrian has led over 100 international chimeb lal climbing expeditions. he is the founder of the expeditions and his team was on the north side of everest in april when the quake hit. we're glad you're here. >> thank you very much. >> in one piece. how scary was that?

>> super intense earthquake. i've been in a couple earthquakes over the years in the mountains, but this was so much more violent. you actually could see the ripples moving through the ground and then hitting the camp. it was really scary. >> could you see trees? >> we were at 17,000 feet so there were no trees, but a lot of rock fallen avalanches. you start to wonder if the ground will open or how bad it will get. >> from beginning to end. >> that first shot i think, went for over a minute and then a series of after shocks after that. >> how many people were you with? >> my team itself were 12 westerners and 12 sherpa. >> what did you do at that point? >> we immediately stopped and made sure the team was safe and we heard everybody on our side the north side were uninjured. but the south side the devastation was just terrible. we were trying to find out about friends and family members and how they were. >> but you're going back for

more. >> going back in 2016. i think everest is a magical and very important experience and, so i'm excited to try to offer it, again, as safely as possible. >> is one side safer than the other. >> the north side in teibet is safer. ultimately in 2014 decided that side of the mountain was too dangerous and too many avalanches and the ice fall where 16 people were killed in 2014 and we really wanted to get away from that part of the mountain. >> why does anyone go to that side of the mountain? >> i think tradition is a big part of it. so much history around that route. and then also the route is easier even though it's much more dangerous. so, people are looking for the easiest way up the mountain and hope that they won't get killed and try it. >> is that the way edmund hillary went? >> it is. >> how much of it do you need ropes for? >> we set ropes at 17,000 feet

all the way to the summit at 29,000 feet. you have 12,000. >> how technical. could we do it? >> you could certainly do it with two to three years of training. >> two to three years of training. >> that's not full time. so building both technical skills and comfort on the mountains and also experience at altitude. >> so you'll be on the side of a face if you didn't have ropes, you could fall how far? >> you could fall thousands of feet. never vertical, but the angle is steep enough when it's ice. >> my only experience with the flat irons in boulder where we would go up and go out and have the same kind of experience. it's not falling vertical but you're going to die. >> that's a great similarity. >> what happened to the economy there? the sherpas and the whole apparatus? >> i think there's so much fear right now that tourism will not return to nepal or that it will be very slow. tourism is the most important

industry to the country and, you know no one knows whether people will come back especially with after shocks and the earthquakes still being in the news and things like that. they're working so hard to rebuild their infrastructure for people to come again. the next climbing season next october and november. we're encourageing people to come with you. >> how much does it cost you? >> $79,000. >> 79 grand what do i get? >> having the most safety you possibly can have. our clients have chosen not to be experienced climbers. they may be athletes and strong business people and strong minds and the ability to achieve whatever they want but they want a high degree of safety. >> you get a t-shirt. >> i climbed mt. everest but all i got was this t-shirt.

you definitely need oxygen tanks? >> everyone we guide uses oxygen. it has been climbed without oxygen. >> what about killimanjarokilimanjaro. you would not use oxygen. >> total people who made it to the summit at everest to the people who lost their lives. is it less than 1%. >> 4,000 people and right around 400 has been killed. back in the '60s and '70s that fatality was 20% and now it's less than 1. >> but it's 10%. 400 of 4,000. >> sorry, i must be getting my numbers wrong. it's down to under 1%. >> so it must be 40,000 400. >> of the number of people you take up very quickly, how many make it to the top and don't make it? >> success rate over the past seven years has been about 70%.

>> pretty good. >> what do you do if i'm in the midst and i can't do it? >> of course a guide or sherpa would always go down with anyone descending and it's -- >> what is your sherpa or guide to tourist ratio? >> two sherpa for every one member. that gives us a lot of human power on the mountain when accidents happen or just to give you the best chance of being successful. >> thank you for coming in. >> thank you so much. >> good luck with the climbs. >> do not turn don't think you're coming back here on the show if you turn back. >> that's like the entry point. you need to be in good physical fitness. coming up this morning's top story and why new york is at risk of overbuilding.

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a squawk newsmaker on set. new jersey governor chris christie is here and no topic is off limits from social security to his chances at winning the gop nomination. it's an interview that you don't want to miss. "squawk box" checking in. >> there is a room available. it is a sweet. we'll only charge you the single room rates. >> what is the rate? >> loews hotel chairman jonathan tisch is here and why high-end hotel rooms are getting more expensive. retailer best buy expected to report. we will bring you the numbers and the reaction on wall street. the second hour of "squawk box" begins right now.

>> announcer: live from the beating heart of business, new york city. this is "squawk box." welcome back to "squawk box" here on cnbc. first in business worldwide. i'm joe kernen along with becky quick and andrew ross sorkin. >> someone wrote in about that already. i'm supporting the program. >> you were thinking about going, right? >> i would go. snows of kilimanjaro. >> u.s. future equities are indicated weak and 27 is not that much so far. the s&p is called down 4. the nasdaq weaker on a relative basis, at least in premarket and down about 12 points. yesterday was interesting to watch. directionless, really. here we are at the upper end of the range. we hit some new highs, but we'll see. we'll see whether the dow averages finally push through with some conviction.

it's been tough sledding in 2015 so far, obviously. >> tough sledding. >> okay. you're using some -- tough climbing. >> let's tell you about some of the other stories we're watching this hour. the u.s. is sending 1,000 anti-tank rockets to the iraq military to help fight isis. the rockets are expected to help against suicide vehicle bombs used by the islamic state militants to capture the city of ramadi. meantime in syria isis is in full control of the ancient city. this comes after a bloody battle with syrian pro-government forces. also in corporate news this morning, genology website ancestry.com exploring a sale that's according to reports from reuters. premeria is looking at the largest family history website. private back in 2012. it went private for $1.6 billion and the sale could value the company at between 2.5 and $3

billion. you ever go on that website? i've never been on that website. also apple reportedly changing the font on its iphones, ipads and mac computers. it says it's going to start using a font it created for the apple watch on other devices. the font is called san francisco. it was reportedly designed to improve edgeability. we also have some earnings that are coming out now. let's look at best buy. the company came in with an adjusted number of 37 cents a share. that is better than the 29 cents that the street had been expecting. revenue came right in line. $8.5 billion. right above what the street was looking for. if you look at the same-store sales. something interesting here. in the same-store sales it looks like they are taking out the canadian operations. if you're looking that comps. they're citing a comp number of up 0.6%. that is better than the street had been expecting, too. take a look at that stock. actually up about 6.5% on this news. part of that might also be just

quickly looking through some of the stuff. looks like the online comp store sales online. online comps up 5.3% and that's important, too because you know amazon is a huge competitor and taking a lot from best buy. it does look like their comp sales were up for online. just trying to read through some of what the best buy president and ceo is saying. and i just haven't had time to read through all of this yet. >> this is the quarter where they, this is always the lowest of the year. >> the fourth quartser the important one. >> they make, for example, this year they're expected to earn 1.49. what did you say, they earned 30 cents this quarter. out of the full-year number. it usually comes in the fourth quarter. but it doesn't mean it's not going to move itself nicely. >> we should also tell you real briefly because just crossing the wires cvs healthcare buying

omni omnicare. total value $12.7 billion. but in the meantime, another deal to talk about. different type of deal. hewlett-packard announcing this morning it would sell a 51% stake in its china data networking business for $2.3 billion. and our own david is here to break down the details. nice to tosee you. >> hp but now they're also putting into that business their china services business. you have a company called h3c that has already existed. now they put in those businesses that they also have in china and then they say 51% of this for $2.3 billion. giving the thing roughly a value of $4.5 billion. the deal itself perhaps something of not great importance or wouldn't seenlm to

rise to a level of a mega deal. what is interesting, of course the reasons behind it. they will leave behind in china some businesses they'll operate. their enterprise services business and networks and printing and personal systems. of course, the split of hp is coming as well. those will go with respective companies. they're dealing on companies that are not chinese controlled because of this continued back and forth between the u.s. and china about spying. for example, the big telecom equipment provider not allowed in this country. they are becoming more and more strict on what they're allowing u.s.-controlled companies to do there and impinging on their business. >> like quid pro quo. they're much worse than we are. aren't they? >> i think when it comes to the stealing of intellectual property and i reported a number of years ago, much worse. but the revelations gave them the cover to come back. >> cover. i'm telling you --

>> say, hey, you do it too. we would argue we would do it largely for national security reasons and what they do is steal intellectual property. all that saying listen if you're doing business in china, you may want to have a chinese chinese-controlled company from which to do it. which really comprises all its main businesses in china. >> we prefer that for everything. it's just free c3 com. used to be the cisco competitor. >> now, cisco, by the way, not been having a good go of it in china. >> in fact we had cisco's cfo on yesterday talking about that. is this just a china problem. when you hear about some of the nsa taps out there. you heard germany's been upset with some of these things. france has gotten upset. >> shocked. >> is this the way of the future? if you're a technology company you can't operate one company that goes throughout or is this just a china problem? >> i think china is in the lead

here in terms of at least making it more and more difficult to do business there particularly as they champion their national champions, so to speak. if they have them in a particular business. but it's not something that people should ignore in other countries, too becky, as these revelations continue. >> i thought ignoring this. >> a complete and other joke by the way. >> i think it's nonmaterial. i think it's an excuse. i think it's an excuse. >> you think what is nonmaterial. >> that there is three years later that there is a snowden fallout. cisco, companies when they need to say, wow, it was a little weaker here. i think, i don't think it's material. i don't think there are people saying we're not going to buy a cisco router. >> she said it yesterday. >> she said it was a problem. hp getting out of the business today. >> they're not getting out of the business basically giving up control. by the way, only in china. a university that also happens to own holding company that has,

so they're going to take control of this thing. >> i get it. they would say, no, you're spying on us. you're going to do this. i'm sure number one, they knew all this. they're doing more of it than we're doing. the. >> point is every technology company -- they're a company that has to deal with an international partner or international clients worry about this issue. >> we raised questions on chinese-made products, as well. >> more protection. >> if you want to do business in china, joe. you have to deal. >> 149. otherwise they can't steal your technology, right? >> they probably could anyway. >> yeah. >> it's easier that way. >> david, great to see you. >> good to stop by. >> you see how it's really done here. is that what you said earlier? >> we have a great staff down there. i love to see our old, we still have some of the same people. it's nice.

from our studio. remember those days? >> are you going to be around for 2020. you going it be around for 2020? >> i just want to wake up tomorrow morning. >> the 20th anniversary of "squawk" in september. you were there. >> wow, 20 years. >> this september, 20 years? >> is this the first you're hearing of this? >> yes, of course, are you kidding? 20 years. >> 20 years. >> i'll be there. darn right i'll be there. >> we'll see you before then. see you in just a couple hours. when we come back this morning, steve liesman told us last month about the problems the way the government calculates gdp. now the government says he's right. steve will explain all that right after this. then checking in with ololoews hotel chairman and the effect of the dollar. new jersey governor chris christie will be here. we will cover everything from his plan for social security to his prospects as a presidential

candidate. stick around, "squawk box" will be right back. [ male announcer ] your love for trading never stops. so if you get a trade idea about, say organic food stocks schwab can help. with a trading specialist just a tap away. what's on your mind lisa? i'd like to talk about a trade idea. let's hear it. [ male announcer ] see how schwab can help light a way forward. so you can make your move wherever you are. and start working on your next big idea. ♪ ♪

welcome back to "squawk box."

cvs is buying omnicare for $98 a share. it will allow cvs to go under assisted living and long-term care prescription dispensing business into that sector. i think omni-care is a cincinnati based. we'll talk more about this a little later. acknowledging problems with the way it calculates gdp. this is a story that steve liesman first reported back in april and he joins us right now with more. steve, you were right. >> becky, thanks very much. the government agency charged with calculating the nation's growth rate acknowledging problems with its numbers and pledging a series of fixes over the next several months. the bureau of economic analysis says it's aware of issues in the gross domestic product and developing methods to address what it found. comes after cnbc in a detailed report in april shows first

quarter gdp has been meaningful weaker for just the past 30 years. several economists including researchers in san francisco and philadelphia feds and wall street economists have confirmed the findings. first quarter growth could really be as high as 1.8%. the chief of national wealth division oversee the gdp report said in a statement the agency has identified several sources of trouble in the data including one that we identified, federal defense spending. changes coming by july 30th in time to be included in the annual gdp revisions. only going back three years to start with to the beginning of 2012. i don't know if we can correct all of this over time though. >> such a significant change that you go from 0.2% growth to 1.8% growth it will mess up every data point that you -- how can you ever? >> i think what is going to

happen and this is important for people to understand. i don't think and we have a guess and his thoughts and higher growth. we're talking about the distribution of growth. was it in the first quarter, third quarter, second quarter? >> will even. >> it should even out. that is the whole point. when you go back and when i showed all these economists my work. no that's not supposed to happen. when you seasonally adjust the data correctly it should show relatively even growth and by the way justin did it over the job's report. the job's data doesn't show any season on it all. >> 30 years ago did they assume no winner in the first quarter? did they incorporate the global -- >> winter is included. oh you mean the global warming thing? >> oh o, i don't know. that's a good question. i could go back. there is winter and even worse winters. >> not for long. >> you saw the speech yesterday

at the coast guard. >> i did. >> what was the name of the season? >> ramadi. >> anyway we saw the real threat. guy's unhinged. go ahead. >> steve here we want to talk more about that. john is our guest today and chief economist and, john what do you think of all these? it shocked me reading -- >> the same thing arguing this point that gdp is a very poor measure of overall economic activity for a long time. for example, an unrelated to the seasonal issue, back in the second quarter of 2008 which was really the great recession was beginning to unfold gdp was recorded at above 3% for the quarter. and, so you know tie this back into the fed. when you see the fed debating the economic data and fussing about the last data point. it sort of a little crazy. we should be looking at the

cumulative improvement in the economy. and, steve's right, it's about the distribution of growth. so if you look at the year-over-year growth rates. they're not distorted by this. and year-over-year growth went up in the first quarter of this year. >> does this mean a broader point, though? we are growing more strongly than we think? >> no i think we have i think we have, but that's a separate issue from how the distribution of the growth that is measured is through the year. i think we have been growing more strongly because another thing steve and i were chatting about before coming on set was the productivity data. if you look at the data now over the last ten years we have the weakest productivity growth recorded apart from the very deep recession of 1981/'82. >> that can't be. >> you look at all the technology. this doesn't make sense. why are we investing? >> you wouldn't bring all these

workers on at this time. jobs numbers are on or about real and you would bring all the workers on for negative productivity outcomes. you wouldn't do. all these employers would be. but let me say the next step here and i'll work on this over the next several weeks. finding better ways to think about how the economy is going and this has implications for investment. as john suggested. serious investment for policy. and probablywouldn't make such a big deal if they weren't on the cusp of the first interest rate in nine years. now you have this distorted data. important to get it right. >> great to see both of you. see you, again. coming up occupancy rates at high-end hotels expected to reach an all-time high this year. that means higher prices at check-in. we'll check in with jonathan tisch, next. don't go anywhere, chris christie joins us on set.

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now the answer to today's aflac trivia question. which state was home to the very first dunkin' donuts shop? the answer, massachusetts. getting ready for memorial day weekend and aaa predicting the heaviest traffic in a decade. what the summer can hold for the hotel industry. jonathan tisch is here co-owner of new york giants. he joins us now with more. good morning. >> good morning, guys. >> things are looking good sounds like in your world. >> if you look at the summer ahead, economy is holding steady businesses feel good about sending their men and women on the road. group business is up a little bit. gas prices are down. so, all signs are that it is going to be a strong summer. but that said there are some dark clouds on the horizon. the stronger dollar, which means potentially less international travelers coming to the states.

it could be an issue. >> advance bookings are down? >> no advance bookings are up. >> international advance bookings are down? >> it's now pretty steady. if the dollar continues to strengthen, especially against the euro. also you're going to have the opportunity for americans now to go overseas because it's less expensive. >> joe over there trying to take advantage of the euro situation. >> they are lowering fares to europe. because they know that more americans now have the ability to spend more when they get to europe. >> earlier in the hour when we teased you coming up we said you're worried about overbuilding in new york. one of the things i mean prices in new york have gone sky high in terms of hotel -- >> actually the number that we use. it is fairly flat in new york. that occupancy is still high. >> right. >> average rates are high. but the rev part which translates down to the bottom line is fairly flat. there are currently about 102,000 rooms in new york. that's 30,000 more than ten years ago. there are 9,000 under construction and potentially we

could be with another 20,000 rooms in the next couple of years. so people continue to build. now, as the former head of tourism for new york city, i'm thrilled because it's now happening in all five boroughs. hotels get built in brooklyn and queens and it's spreading the tourism infrastructure throughout the entire city. >> but is tourism getting hurt here by the stronger dollar? >> not quite yet. but certainly that potential exists. and that international traveler is so important to us. especially here in new york city. they stay longer. they spend more money. the numbers are really compelling about how much the international travelers -- >> what about the business traveler? >> the business traveler is on the road. they're free to go about and do their business. as i said group business, which was always a concern since the downturn of '08. group business is also fairly strong, also. forward projections for the industry through the summer and the fall we're optimistic about that. >> branding question. you're rebranding. taking the brand and creating

this loews regency brand. >> we recently bought the mandarin oriental which is one of the finest properties in san francisco and we've been using the renalancy regency name on park avenue and we said this is an opportunity for us to take a flag that we already control and look for other properties. so the second loews regency hotel is the oriental in san francisco and we continue to add to our portfolio. in joint venture with comcast. we are growing our product and another 1,000 rooms that will open at a room. 5,200 rooms in orlando. we're optimistic. >> how many more hotels do you think you'd put that name on? >> the regency name? >> yep. >> three or four others. we'd love to grow it to 15 or

20. it's very specific. smaller. doesn't have that much meeting space. we want to have a power breakfast there like we do on park avenue as joe knows because i've seen him there. >> i like the eggs benedict. >> i can't eat eggs benedict at 8:00 in the morning. >> deflate gate. >> i've heard of it. >> what do you think? >> the patriots will do what they think is appropriate. >> what would you have done if you were the league? >> in terms of the -- that's up to roger. >> do you think it was right? is a million dollars right? would you kick brady out for four games. >> i think the commissioner made a decision based on the facts that he has with his colleagues. >> more likely than not. i don't know. >> does it upset you that they don't know that was really conclusive? that's the thing that is hard for me. >> i understand. >> two different measurements. indianapolis has one measure. >> that's a different question.

whether the league should be controlling the balls prior to the game starting. >> we still don't know whether -- i still don't know whether it's a huge event. almost just like superstition with guys how they want the ball. >> athletes get crazed about pregame prep and -- >> it's not vaseline on a baseball and certainly not juice in your veins, right? i don't know. all right, we have to go. >> jonathan great to see you. >> nice to see you guys. >> the wi-fi, you still charging for the wi-fi at the hotels? >> wi-fi is free. >> eggs benedict is not free. >> have we ever looked -- >> too rich for you in the morning? i've been up since 3:00. >> have you ever checked the ip addresses of all the wireless at your hotels? >> i don't think so. >> okay. i always thought if you looked. >> do you think i'm borrowing your -- if you could see where

everyone is going. >> in their rooms? >> you're bringing that up? >> i am just saying -- >> that we have the personnel. >> i just. >> i didn't say it. i'm at a loss. i'm at a loss. coming up our new jersey our newsmaker of the hour chris christie joins us on set. (music) boys? (music) stop less, go more. the passat tdi clean diesel with up to 814 hwy miles per tank. hurry in, and you can get 0% apr for 72 months on 2015 passat tdi models plus a total of $1500 in available bonuses.

welcome back to "squawk box," everyone. among the stories front and center this morning, hp is selling a majority stake in its chinese data operations. the price tag $2.3 billion. retailer best buy beating the street. earnings revenue and same-store sales all beating expectations. and cvs health is buying omnicare and that deal is valued at $10.4 billion when you exclude debt. >> you come through the tunnel or the -- >> tunnel. >> bad right now. let's get to our newsmaker of the morning. some rebs are troubled.

troubled that there is no clear frontrunner in the gop as the democrats seem to be involved in a coronation of hillary clinton. in fact in "wall street journal" today some republicans saying it's unseemly what people are doing. it's democracy in action is what it looks like. he said some people say it looks like a darwinian selection where it will be survival of the fittest and he points out maybe that is a good thing. he goes on to say chris christie, the governor of new jersey who is declared back in february is back after delivering three detailed speeches on entitlements tax reform and national security. the governor of new jersey and potential presidential contender, chris christie is us with this morning. governor, i ask you, what is better? being where everybody was begging you or being written off and coming up and, you're talking the same stuff. you haven't really changed. >> they're both fake. >> they're both fake. >> they're both fake.

no way i was a sho in four years ago and as you can tell this morning, i'm here and breathing. both of them are fake. in this business if you respond to what you hear on television and, you know on the internet and in newspaper columns, you're dead. you're dead then. so you just have to be yourself and see what happens. >> it's totally different the way that the democrats, hillary clinton is approaching in terms of talking about policy. i don't hear her really talking about policy except being a champion of the middle class and hedge fund compensation. first of all, you did social security. that got people talking about chris christie again. but more recently the op-ed on how to reinstill growth was almost a playbook of what some people think are old guideideas. but you want to talk about social security? >> sure. i mean first off, 71% of the federal budget is now consumed

by entitlements. so social security medicare medicaid and social security disability insurance. if you don't deal with those and you want to be in the national conversation, in my view then you have no business talking about the other 29%. >> although it may not be popular and may not get you, you know people don't all of a sudden say this is new. this guy is really hot. this guy is someone we need to look at from social security. >> it's your job. if you're someone out there in the national conversation, you want to move folks. you don't react to polls, you try to move polls. the way you move polls is by leaning and putting ideas out there that are necessary, even if they're not popular. your job as a leader is to try to make them popular and understandable. one thing i have always been able to do in my public life is make things understandable to people. that's what i'm trying to do on the entitlement area and economic policy. >> economic policy. i don't know how that was received.

i assume it was received well by the right. you're talking about three different tax codes. right? but revenue neutral. you talk about bringing down the corporate tax rate. you talk about ways that growth can solve income inequality, instead of oworking around the edges with minimum wages and redistribution and things -- >> the president talks about income inequality. and income inequality has gotten worse. you know, the middle class is still running on a treadmill and getting no where. wages are stag nent really for the next 15 years for the middle class and the wealthy have gotten significantly wealthier during this president's time i think in large part because of a lot of his policies. you know easy money at the fed. very low interest rates. i mean it's inducing a stock market rise that we've all seen and that helps folks who are in the investor class. i don't have any problem with the investor class doing well but i don't think that is who needs to be protected that moment. the folks who need to be protected by growth coming back

are the middle class. because when growth comes back opportunity comes back and then they are not working just two or three jobs. the president talks about creating jobs and the president knows that because many are working three or four of them to make ends meet. this is a big part-time employment area now. >> it helps with everything. goes back to the entitlement issue and you get some growth and suddenly those numbers. >> the debt and deficit problems. >> redistribution solves number. >> the debt and deficit numbers become more manageable. it's true. it may be old. but it's true. >> governor, on the entitlements, we hear from people who have studied the issue who absolutely will agree with everything you've said. these are people who have done the studies and dug into all of it. what is the response you've gotten from just average voters and average people on the street? >> it's interesting. i've done four or five town hall meetings in new hampshire this month and the reaction has been really good among people in new

hampshire. they nod and they understand it. they understand that we have to deal with this problem. and, so we'll see over the long haul, you know becky, if i get into this how it will play out politically. i can't predict that for you. but i did not feel like you could enter a national conversation and not deal with this first. if we don't deal with this issue, it's going to eat us alive. we see it at the state level. and we're going to see it at the federal level. >> speak to the state level issue and in your own experience in new jersey. i think all these ideas are brilliant ideas and you want to see job growth. but in new jersey job growth has not been nearly as robust as the rest of the country. last year they said the second worse job growth among all states in the country. so, how do you square that? >> they won't follow my plan in new jersey. you know i've been able to get a lot of things done in new jersey where we capped taxes and discretionary spending of where it was eight years ago and we started a reform pension and benefits. but the problem is they have not

cut taxes in new jersey. we have one tax cut of $2.3 billion that we're purely focused on business and i proposed lowering rates and i have a democratic legislature. they simply won't do it. i guarantee you, this may or june they'll send me another tax increase that i'll veto. so there's certain things as governor and a blue state going to be able to get done. other things tax cuts are absolutely, you know to democrats. they don't want to do it. so, i think thegrowth would be much better in new jersey. if we lowered our rates. if we lowered our rates below new york jobs would rush from new york to new jersey. they always have when we done that. when we're higher like we are now, the jobs stay here. it's the way it goes. >> okay. just quickly switching, you've given national security too. or written about national security. did you see the coast guard speech yesterday? >> yes. >> what was your response? >> i mean listen.

i stood in portsmith, new hampshire, on monday and talked about the three pillars of restoring america's role in the world. we've shorted national defense in a significant way in this country. we're on our way to a 260-ship navy. we're on our way to having 100,000 fewer soldiers in the army and 50% reduction in our air force. and no wonder vladimir putin is doing what he's doing in eastern europe and what the chinese are doing what they're doing in the south china sea. they're not intimidated by the united states any longer and for good reason. secondly, we're not investing in intelligence the way we should be and this debate in my view that we're having down in washington, d.c., is not only wrong, but it's dangerous. dangerous for america's safety and security. we have to work our building alliances around the world. our friend don't know if they can count on us any longer. if the president drew a red line in syria and said no never mind. they don't know if they can

count us any more. our adversaryies are acting in a way they no longer take us seriously. >> what do you think about simpson bowles. they also said defense spending needs to come down. >> the entitlement reform i put out there saves over $1 trillion over ten years and i think some portion of that needs to be reinvested in national defense. but, you know at least unlike anybody else in the national conversation putting out the way we can actually do it. and i think one of the things we're really missing right now is other people are not talking about specifics. you need to be specific. the american people after this administration they're taking nothing more on faith. they bought into hope and change, you know seven years ago. and with great, with great enthusiasm. but when you don't give specifics, the american people are going to get smart about it this time. they're not going to go with someone who doesn't give them specifics. >> when we hear, i saw a lot of republicans yesterday after the coast guard speech talking about

ramadi and talking about isis and, you know the acts that had been purperated that we've all seen recently. how do you go and give a speech about climate change the day after ramadi falls and then the city in syria and we've lost gains there. the isis tratgy doesn't seem to be working and then you throw in some of the osama bin laden, the transcripts that have come out about iran working with al qaeda. working closely with al qaeda. it just all seems. i feel like i'm in some surreal alice in wonderland almost. >> it depends on if you want a foreign policy where you care about america being successful and a leader in the world. if you think that's what success looks like. i just don't believe that this administration has believed that america being a leader in the world is their goal. you know, the president said seven years ago that we were essentially the cause of violence in the world. if we pulled back from iraq and

afghanistan and we gave some nice speeches and went around the world and held hands with people the world was going to be better. the world is much more dangerous than when he became president. the reason is what the world wants is america to leave. the reason they want us to leave is because they know we don't have any aul tearlterier motive to our leader. we're not looking to be conquerors. the people who fill that vacuum want to be conqueror. russia wants to be a conqueror. iran wants to be a conqueror and they say, geez we had some problems with america, but, heck, a lot better having america leave than these other folks. this president doesn't understand that and i don't know if he believes it. >> i want to get in a media bashing mode but i look at the way things are phrased sometimes. we've spent more talking about hindsight and what should have

been done 12 years, whenever it was. the jeb bush situation and everybody has to answer the question now what would you have done? nobody in the media asking the question of whether we pulled out too quickly and gave up all these hard-fought gains. does the obama administration need to answer that? do democrats need to answer that question? >> they should have to but that's not the liberal conventional wisdom it's not going to be asked. listen, the media, unfortunately, in my mind i've seen this acutely in the last couple of years. whatever is on the front page of "new york times" is what they talk about. that's what they talk about. that's who they go to cocktail parties with. that's what they do. if you're frustrated by that i apologize to you. but welcome to the real world. this is the way it goes. >> when you think about bridgegate and the media coverage of bridgegate and then go back the last three months after hillary clinton, secretary of state hillary clinton

announced her candidacy and look at the disclosures that came out in reference to that. in the amount of time spent on bridgegate. >> it's absurd. >> clinton foundation or prior to that -- >> it was the server. >> prior to that it was -- >> you tell me. i'm sure if you looked that covers over the past three months relative to bridge gate at the time, do you think bridge gate was that much more covered? >> that much more covered. at the time bridge gate was out gunning six or seven to one the coverage of the irs scandal. now, do we really think, and especially now 15 months later when we see that everything i said the day after that story broke, everything i said. has proven out to be true after three different investigations. the internal investigation which everybody in the media mocked which, by the way, wind up coming to the exact same conclusion that the legislative investigation run by democrats was and that the u.s. attorney's investigation came to. >> you don't think there has

been terrible coverage of hillary clinton and the clinton foundation for the past couple months? >> andrew all i ask you is this. if i came out the day after the bridge gate thing was announced and said, by the way, all my e-mails are on toa private server and i deleted a whole bunch of them. you have to take my word for it. the e-mail husband nothing to do with the bridge stuff. can you only imagine what the reaction would be. today we don't talk about the e-mail situation withany more. i do believe there is an absolute bias and a rush to judgment. you all know this. you saw the coverage of me 15 months ago. i was guilty. guilty. i had done it. now we're 15 months later, where are the apologies pouring in that not one thing i said on the day after the bridge situation has been proven to be wrong. so, all i'm saying to you is has there been coverage of the e-mail situation with the

secretary? absolutely. but the intensity of the coverage and the relentlessness of the coverage is different and that's where the bias is revealed. >> at this point people that were i saw secretary clinton with one of our guest hosts yesterday introducing her. if you like hillary, warren buffett. i asked him on the air. is there anything even after all of this anything ever that would cause you to maybe doubt your faith in her whether she would make a good president? i don't know if there is anything. nothing has changed based on all of this. her numbers probably haven't dipped at all. you add in immigration. you add in whether the republicans decide once again, to talk about marriage equality. i can build you a coalition where she's going to win, again. >> but her negatives are very high. >> but they're not 50%. >> i don't know if they've changed. >> she can put together a coalition to win and it's not going to matter. >> this is what campaigns are all about, joe. i mean in the end, if my party

nominates someone who can connect emotionally with the american people and make a compelling case for why our set of philosophies and approaches are better than hers we'll win. >> do you think you're the best person for that? >> listen if i, this is what you include, becky. if i decide to run, then you can conclude that i think i'm the best person to do it. one thing i will say is this you know we shouldn't take it on faith this time. we should nominate someone who has actually won. who has actually won in a difficult situation. one of the things that i think recommends a candidacy by me is having won twice in new jersey. you know we look at what the political situation is like over there. and it is it is a brutally difficult one for a republican yet i got 61% of the vote for re-election. so, you know and what matters is when you're campaigning. your polls will go up and down based upon other events and mine have and they're down at the moment and they'll go back up again based on events. when you're in a campaign mode

and selling yourself to the people who you're asking to vote for. that's when you can best determine what that person's ability is to appeal. >> the very first debate is in august and they're already saying they're going to look at ten candidates. they have to be polling well. that's the criteria thaley'll use. when will you decide? >> i said probably next month i'll decide. i'll have a day job and i have to get a budget done by ojune 30th. i don't want any more distractions. but i have been going through the thought process and made it clear to folks. >> what is the threshold for you? what is going to be the turning point? one way or the other. >> it's all internal. nothing that happens externally. it's not about poll numbers or fund-raising or feel or any of that. it's three questions. is it right for me? is it right for my family? is it right for the country? if you answer yes to all three, you run. if you answer no to any one of

those, you don't. >> where is the family right now? >> family is pretty good. listen, two of my kids are off at college. so they're just like listen good luck. send the tuition check. they'll be fine. and the two younger ones we're having a lot of conversations. they're 14 and 11. it's not like they're going to be making the decision. they need to understand what this is going to be like. mary pat recently decided to leave her career in this business to provide, i think, a sense of stability to the kids that if we decide to do this that we're going to be involved in their lives still. that's the hardest part of it andrew. 14 and 11. i mean it's a lot of time away and you don't want to mess up your kids. and that's the hardest part of it. >> governor how do you, i don't know how you walk the tight rope between not alienating what people i'm not even sure it's a republican base any more but still worry about alienating that base by being more inclusive on social issues and i said this a lot in the last

election. i heard people on the radio. they could have recited your growth but then they said i don't have the same rights as other people. when does it become look if you want to govern you need to get elected. why not be einclusive? why not focus on the economy and is there a republican candidate that will see that and say, look, i want everyone to be happy. we include everyone. i don't care what your personal preference is anywhere. >> first off, as a candidate, you have to be disciplined and not fall into the trap. the trap is that there are certain elements of the media who want you to talk about that. who only want you to talk about that because they're goal oriented and their goal is to get the democrat elected. they want you to do it. the worst part from my party, my perspective, not necessarily the positions. these are divisive issues because the country is divided. so it's your tone and how you talk about it. if you talk about these issues in a way that you are absolutely

critical of a person who has a different view than you. and dismissive of them. then they are dismissive of you as a candidate. if you are talking to a person who is pro choice and you're pro life and you say, listen i'm pro life and that means i'm going to heaven and you're pro-choice and you're going to hell. if that's your tone they don't care what you have to say about pro-growth policies. they care that you seem intolerant to them. that's tone. that's not position. i'm pro life and i had that position as a two-term governor of new jersey. the first person who was elected a as pro life person to a state office in new jersey. my state is predominantly a pro choice state. but the folks in my state know that i believe it's a difficult issue and they know where my heart is. but they don't think that i dismiss them. that's the difference. >> the tougher issue because if you're the president, you get to actually nominate the justices on the supreme court. and you might be -- >> we get to do that in new

jersey, too. >> you might be open to that issue but on the other side when it becomes a court issue, it becomes much more complicated. >> any president that believes they can absolutely figure out or any governor that nominate a justs to the supreme court. we've seen that over and over again in our history. as a president, would you try, what i would try to do is pick conservative judges who believe that their job is to the trpinterpret the law, not to make it. once you put somebody in the court, you never know what is going to happen. it is a more difficult issue, andrew. his tone is about electability. it's how you present yourself. i feel strongly about the things i feel strongly about. i don't have topart of our problem is tone over time and if the republican candidate for president is tone and better and more inclusive than you can get to the other issues that the media doesn't want you to get to. >> when it comes to same-sex

marriage, it's a little different. if your idea is that i can't get married to someone of the same sex, that's almost saying it offends you and you're stepping into my life with that. >> no, it could mean something very different becky. folks should have exactly the same legal rights but that marriage is a 2,000-year institution has a particular meaning. that it's been between a man and a woman. now, you can absolutely whole heartedly believe that and say to someone who is gay, you should have every legal right that everybody else has. we are now arguing over the meaning of a term and that's a different argument. now, the -- >> the word marriage is so precious to certain people that it can't be used. >> words have meaning. words do have meaning. if they have a 2,000-year-old meaning, then you know, the movement of those. like i said in new jersey. if we wanted to have same-sex marriage my view was put it up to a referendum. if the people in new jersey voted they wanted same-sex

marriage that's fine with me. it's not my position i don't agree with it. but put it up to referendum because the changing of something that's 2,000 years old at its core is a major societial shift. now, we seem to be in the midst of that kind of societial shift. >> 60%. >> but the fact is let the shift happen where the people get to speak to it. now in my state, they went to court. the groups that favor this. they sued. our supreme court said same-sex marriage is constitutional in new jersey. well then the argument is over in my state and my job as governor since i took an oath is to enforce the law and i've done that with same-sex marriage. even though on a personal level i disagree with it. once your supreme court speaks and the constitution requires it, then you have a legal obligation to do what the supreme court has told you to do even if you disagree with it. my view was we shouldn't be allowed to be seven justices and let the people vote. not in a negative way.

not to ban it. but say coo you want to permit it? the legislature in my state wouldn't permit that. that's interesting that they didn't trust the people enough to put a vote on it. even looking that polling knowing that my position was not necessarily the popular one in new jersey i said let people vote. and then that way no one could argue that a group of seven elite judges made this decision or a group of 120 legislatures and a governor did it. the people in new jersey did it and they raised minimum wage in my state. imagine that the minimum wage got raised by constitutional amendment on the ballot. that's okay to put on the ballot. it's not okay to put same-sex marriage on the ballot. i'm okay with people being hypocrites, just admit you're one. >> governor thank you. we're out of time. hopefully you'll come back again. >> i have to come back. here's why. my wife watches you every morning and she, i am here this morning in large part because mary pat said you haven't been on there in a long time and you

need to get on there. >> give mary pat our best. >> i will. >> it is going to be fun to watch. at least. >> i'm glad to know i'm alive. it's really good. great reading the newspaper this morning. i was breathing and i read that.pthat. >> we'll look forward to your decision. coming up, when we return mcdonald's holding a shareholder meeting this morning. a look at the fast food giant's new menu strategy. performing against the s&p index over the next year when "squawk box" returns.

fixing the golden arches. faces shareholders for the first time since taking the helm at mcdonald's. minimum wage workers set to protest. we'll ask a top analyst what he can do it turn around the clown frown to turn it upside down and get the stock sizzling again. rocky mountain home prices are sky high. a look at the real estate boom in denver and what some folks are doing to try to win over sellers in order to get that perfect house. here's a hint. bring cash. and letterman's last stand. >> the only thing i have left to

do for the last time on a television program, thank you and good night. >> ceo and executive producer of "late show with david letter" is our special guest. a trip down memory lane. >> how is mummy? >> good. >> what is mommy's name? >> i don't know. >> a look at life after letterman. the fineal hour of "squawk box" begins right now. >> announcer: live from the most powerful city in the world, new york. this is "squawk box." welcome back to "squawk box" here on cnbc first in business worldwide. i'm becky quick along with andrew ross sorkin and joe kernen. 90 minutes away from the bell on wall street. watching the futures this morning. check it out. dow futures down by about 17 points and s&p futures off by three and nasdaq down pie about eight. if you look at what is happening

in europe at this hour. you see the dax is also down. and in terms of the bond market this morning. that yield still sitting right around 2.2%. even after the fed minutes 2.28% and oil prices have been creeping back up. yesterday they rose breaking a five-day losing streak. this morning they're up once again, getting close to $60 a barrel at 59.58. let's talk about some of the stories that investors talk about this morning. hp selling a majority stake in its marketing operation. the price tag for that deal $2.3 billion. also cvs health buying omnicare for $89 a share in cash this morning. that excludes debt goes up to about $12 billion if you put it in and then political news this morning, as well. only the top ten republican candidates will be participating in the gop first presidential primary debate. the decision announced by the organizers and that showdown set

for august 6th in cleveland. among the possible candidates chris christie who talked about his economic plan including talking about income inequality. >> the president talks about income inequality and it has gotten worse during his period of time. the middle class still running on a treadmill and getting no where. wages stagnant for the past 15 years. and the wealthy have gotten significantly wealthier during this president's time i think, in large part because of a lot of his policies. easing money at the fed and very low interest rates. i mean it's inducing a stock market rise that we've all seen and that helps folks who are in the investor class. i don't have a problem with the investor class doing well. i don't think that is who needs to be protected a that moment. >> i was thinking about everything last night. you don't even know how to

handicap anything and then i was thinking about recently. remember when mccain was the nominee. it started out mccain and then he disappeared and they looked at the alternatives and they said, bring mccain back here and then i remembered howard dean. he was winning state after state after state. i am not convinced. i don't know if that was it. and then kerry was hot for a while and then they finally said oh, we have to bring. let's go with kerry. very strange the way it works. you're in favor, out of favor. >> we're still in the first half of 2015. the election is 2016. >> chris christie is in favor, out of favor. you look at the crazy polls. it looks like rubio is leading the poll at 13% and then next it's 12 and then you have 3 at 11 and then you have six or seven of them down at five or six percent. so, 13 is winning and last place is 6%. is there really a difference between 13% and 6%? >> very close run to see who gets the republican nomination.

>> is there any chance andrew you would be the one, i mean o'malley is talking about youthfulness and showing bill clinton talking about how he'd make a great president some day supposedly. bill clinton said that about o'malley in the past. president some day. >> going to come out of no where? >> i'm saying is there any way it's not a coronation? >> perhaps, perhaps. look, we thought she was going to be the candidate eight years ago e. >> she's going to be the candidate. that doesn't mean she's going to win, though. >> she's going to win the nomination is what i'm asking. >> i think she wins the nomination. >> anything that could come out at this point that would derail that? >> nothing. >> anything could happen on either side. >> the problem is that there is nobody else. that's the problem. it would be great if there were more. >> you think democrats are nervous that at this point they have their candidate. >> no but, look the problem with hillary clinton is that a lot of democrats don't really want to vote for her. they feel stuck with her. that's the issue. >> that's what i'm asking.

>> when it comes to -- >> like i pointed out, she has high negatives and high positive positives within the democratic party. >> unshakable. but when it comes to people who actually want to go to the polls. you have to actually want to wake up in the morning and decide affirmatively that this is the person you want as opposed to deciding and then you have people who just don't go to the polls. >> i think she has very strong support from within the party. >> we'll see. but, let's tell you, shareholders and protesters gathering in oak brook, illinois, today for the mcdonald shareholder meeting. steve easterbrook will address the crowd for the first time as the company's ceo. earlier this week, the ceo of andrew pudzner had advice for the golden arches. >> they seem to be confused about who they are and what they want to be. you can't be everything to everybody. you can't be the place that is for women and kids and old people and young people. you have to pick who your target

is. i think they've had, they've gone everything from coffee eto frappes and burgers. you don't really know who mcdonald's is any more. >> we'll try to figure out what that identity is. here to talk about what mcdonald's needs to do. retail analyst at morning star. what should the identity be? they really are all things to all people and how do you narrow that down? >> i think that's a verypoint. it seems like a lot of emphasis on millennials and minority groups at this point while still catering to the family audience. i think it kind of depends on what the company things longer term here. the family space that could be a big opportunity with so many of the other groups focusing on millennial groups and that could be the core confidentacy for this group. >> what do you think we're going

to learn today? he put out that video two weeks ago and sort of laid out a vision, but not much detail. >> yeah. i don't think we're going to learn anything that we haven't heard at the video that we saw on the analyst conference call a few weeks ago. he was also in front of franchisees last week talking about certain plans. i don't think we'll learn anything more about product platforms and anything beyond the cost cutting measures. just reiterating what has been out there in the market at this point. hopefully shareholders and their views, too. >> r.j. do you think that mcdonald's shareholders and mcdonald's franchisees are aligned these days? when you listen to easterbrook. you realize he's talking to two different groups at the same time. >> at the end of the day, i think both shareholders and franchisees are looking for the same thing. turn around in same-store sales and more profits for the franchisees themselves which will keep both groups happy here. again, the message right now is

there's not a lot of visibility about what -- >> additional capital costs and now capital investments and then when you start thinking about what the changes are on the menu and what that is going to mean. >> that's where we need the clarity. at the heart of the turn around right now. we haven't heard that new exciting platform and that product news that is excited about the brand, again. with that, a lot of uncertainty that franchisees have to deal with. this will require new capital requirements and see a lot of instore improvements and external internal renovations. those are things that we need to answer. >> do you think that the stores will have to end up looking like the stores in europe for example? that was a very expensive to do. >> that was. and it did have a meaningful lift in same-store sales at the time. although we've seen a little bit of that taken away with some of the issues over there. i think they need a modern approach to restaurants. i think certainly going to be a lot of capital required on that.

certainly you're looking for a better instore experience and a lot of that comes with the look and feel of the restaurants. at the same time too. some labor improvements that need to be done and technology upgrade that need to be put in place, too. that's unclear. they talked abouta big mobile platform and we haven't heard more details other than it is a big platform. >> would you buy this stock? >> at this point, i think it's probably fairly valued. a lot of interesting things that the company is doing. the things like the cost cutting and the refranchising and simpler menu. i think those are all practical but they need to take it to the next level. for better or worse, this company is lined up with what 3g did to burger king and going to 99% franchise and doing a lot more cost cutting and other things, too. but they had things too, like real estate transactions and potentially looking at you know other shareholder returns that they could look at. that's something that the company just comes out and says

hey, if we're looking at these things and we're taking all options. this is what we explored and give hard evidence to these turn around efforts. >> r.j. thanks for joining us this morning. appreciate it. coming up it looks like june may be off the table when it comes to a rate hike. so, could september be the month and how will the markets act between now and then? we'll try to shed some light on that next. coming up later, david letterman's executive producer rob burnett will be our special guest. if you went to bed early, here's a clip from last night's letterman sendoff. >> dave, you are to comedy what i am to comedy. >> thanks for finally proving men can be funny. >> dave i'll never have the

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box," everyone. retailer best buy beating the street. earnings revenue and same-store sales all topping estimates. data storage equipmentmaker missing the mark on its latest quarter. results hurt by lower sales to equipment manufacturers. joe? is the market right about the fed and the possible rate hike later this year? here with us barbara rinehart for the americas. becky doesn't think it will be this year at all. >> well few schools of thought. >> maybe it's not. you think it will be this year? >> i don't know. not sure. >> maybe it was you -- >> i think it might not be this year. >> there are people saying no. i'm sorry. >> michelle. >> yeah. my other tv wife. >> we all lookalike. >> someone i with three names. but not andrew ross sorkin. she was here -- >> wow. wow. >> she was here last week and i just remember someone saying definitely. >> i'm not sure.

>> it wasn't insulting. >> he just called me his wife i don't know how i feel about that. >> because we're together a lot. >> a bromance. >> the first school of thought is that the fed cannot lift rates until there is an unambiguous acceleration of the u.s. data. that could cause a wobble to the equity market. in 1999 when the fed hiked interest rates in june equity market was down three and a half months later. the other school of thought is this kind of weakness you had in the first quarter continues. even though it came off of overy strong data at the end of 2014 it continues. the fed can't hike. eps revisions come down risk assets get dragged down with it. those are the two schools of thought that are really in the financial markets at this point. at credit suisse we feel there is a better chance that the fed does hike in september. we do have some positive data.

nonretail sales and you see bank lending is growing at 7.9%. there are some signs you'll get the long waited reacceleration and that will put september on the table. but it is a kind of a real guess at this point. >> it's crazy, though. there is an election we just found out there is an election coming coming. it is so hard to take away the punch bowl as the election is approaching. can't they just do a quarter. if they don't want to do more can't they just stop? just do a quarter. >> there's two things also that you have to answer joe. the fed has spent a tremendous amount of time priming the markets they want to raise interest rates. if they don't, they have to worry about a credibility issue. the second thing that is very important that we're telling our clients. a tightening of monetary conditions are not the same thing as tight monetary conditions. as you said, a quarter of a point. >> the market won't know what they're doing unless they say we're raising a quarter point and they put us back on some calendar and say we're not coming back for six months.

the problem is a lot of people said maybe what they will do is raise a quarter point and go away for a while. the market won't know that. >> that's why everybody what janet yellin says in her q and as. we're in an age where the fed is far more open with communication and it's a good thing, but it also has consequences of raising volatility around any nuance message of the fed. >> maybe your st. looks a whole lot better too. we don't need the dollar any stronger. if your rebound is better and then we won't worry so much about what that does to our trade situation. >> well europe certainly going along with the growing global economy at this point. last year europe was really feeling in tough shape just about 12 months ago. you're starting to see it. better retail sales out of europe and bank lending growing and every low levels but, still, fundamental change at the margin tells us that europe

should be doing a bit better which only contributes to the case that u.s. growth should be picking up in the second and third quarters of this year. >> it's a watch, wait and worry time. it's a reason to have a little bit more cash and little bit more defensive in your portfolios. >> watching them wait for a long time. >> worrying is the other part too. it's this kind of outcome if we can get the reacceleration. we do see tentative signs of it though. >> you have thought, won't be a rate hike in nine years. >> this is the first rate hike in nine years. >> might not be nine years. might be ten years when it's all said and done. >> if i'm right. >> if becky's right. if we're right, it's going to be september. but either way. >> fw itif it happens that way. >> that's what i fully intend to do. >> i feel a wager coming on here. >> i would have done it. i would do it in june. go a quarter in june. i think that -- >> what would, you think it would shock the system? >> no i don't think it would at

all. i think it would be good. >> the bond market has priced it in. >> for june? >> no. the bond market was overshot territory earlier this year with worries about deflation. it's kind of up come up over those lows. it wouldn't be a shock to the bond market. >> all right barbara, we'll get -- i'm not going to remember what you said either. we have you know they all lookalike. >> at least seven of us women. >> we'll remind you. >> no what it is take to our advantage. we're right, it was us if we were right. >> i'm going to write it down. >> market that one. >> thank you for coming in. it's great to see you. >> thank you for having me. when ewe come back is denver the hottest housing market in the country? a look at what's driving demand and what it takes to win a bidding war there. the data point of the day, jobless claims numbers will be out. the market reaction is just ahead and "squawk box" will be right back.

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there's been a real estate boom in pockets of the country and existing home data is going to be released. last month existing sales hit their highest rate in a year and one area of the country seeing a big sales boom is denver.

diana joins us now from there on why there and why now. diana? >> well, denver is red hot and the reason is, apple and google are bringing jobs here. home construction is very weak and all the real estate agents tell me millennials love this market. so, what is the result? supply of listings down over 15% from a year ago. home prices up 11%. and days on market down over 30%. homes are just flying off the shelves and bidding wars are the new normal. >> prices are going crazy. multiple offers love letters, videos, all kinds of things to appeal to a seller in order to make yours stand above all the other offers. >> now, schaefer's client chris simmons has been shopping for a home for six months. he lost out on eight houses because each one of them went in one weekend. and then he lost two other bidding wars. one of those had 18 bidders. now, he is finally under contract but he had to beat out

five others. >> i waived inspection and the appraisal contingencies on all the offers i made on this one, as well. >> now, those tactics are pretty risky. you have to ask, where are the homebuilders? the land prices around here right now are at an all-time high. the only available land is out by the airport. so builders' margins are being squeezed and also an issue with condominiums. a recent law passed makes condominium developers responsible for the tiniest flaws in construction and that basically brought construction of condos to a halt. we'll talk about that coming up later today on "power lunch." back to you guys. >> okay diana. thank you. >> we just had barbara on the show and she pointed out, too, rent in denver have gotten very expensive. relatively speaking. she was talking about a one bedroom being $1,400. that doesn't sound like much in manhattan. the millennials are getting priced out of the market too.

another reason you've seen such a huge drive for sales, diana. >> we've seen a lot of construction in the apartment sector. but the question is how high can they go so there is enough demand. if millennials can't afford them, who are coming in? >> denver. all right, dianeau thank you. appreciate it. coming up an intern executive, producer. robert burnett talks about working with david letterman and what's next now that letterman has retired. as we head into break, look at u.s. market equity futures. [ male announcer ] your love for

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couple stocks to watch this morning. sales force peting the street on the top and bottom lines and raising revenue forecast for the full year. dollar tree shares down right now. earnings revenue and same-store sales falling short of consensus and outlook is also mute. then l. brands better than expected earns and revenue fell short. williams sonoma current quarter

guidance is cautious in part because of the west coast show down. we are a few seconds away from the jobless claims. again, this morning the futures have been under just a little bit of pressure. rick santelli is standing by at in chicago. take it away. >> we're expecting a number close to 270 and we got 4,000 more than we desired. 274,000, an increase of a very neat 10,000 from an unchanged, unrevised 264. 2.21 million on continuing claims. little bit different timeline but still showing roughly the same correlations to history in terms of the drops that we've seen over the last several years. preopening equities have improved a bit, but they're still negative. interest rates you know 223. we settle at 225. the high yield close since december 229. we'll continue to monitor.

of course, existing home sales at the top of the ten may give us more clues. you heard diana olick. pockets of strength and pockets of weakness and housing and the existing market of course is bigger than the new home and starts market. that number was pretty good. so, we will continue to monitor and digest the minutes of the fed meeting, which really didn't have a huge influence, but, again, the debate goes on as to exactly what's going on in the federal reserve and the committee's minds regarding normalization of rates. becky, back to you. >> all right rick thank you. >> steve liesman is back with us with more on the numbers. >> so this is a good what were you looking at? >> just look at what you're doing. >> is that where you're getting your information? >> that's where i'm getting my information from. >> the real chart. just looking at the number and thinking how economists will factor that into the job's picture and, again, we're in that very nice zone. down well below 300,000. and a number that people think

are going to lead to 250,000 job growth right in there. so they're going to think the employment numbers are going to continue and continue to be strong. what was interesting yesterday i thought about the fed minutes was i thought there was a contradiction. they told specifically that they were not going to tell us specifically when they were going to raise rates. there was a line. but that wasn't the contradiction. then they told us it wasn't going to happen in june. >> so they are telling you. >> they are telling you it ain't happening. it's a bit of a contradiction and i think the fed wants to move away from this calendar-based guidance thing. >> moving away from calendar guidance, a lot of people on wall street are saying they'll raise by a quarter point and then they're going to go away. >> the one and done thing. >> the only way wall street knows that is if you raise rates and then tell everybody we're not going to raise again for the next three months or six months and you're back on being tied to the calendar and otherwise wall street may think it's off to the races. >> i don't think that's going to

happen and i disagree that they're going to do a one and done thing. everybody is so sure. what the fed is going to do you know, i want to know what their economic forecasts are because if they're so sure about their economic forecast i have a basic framework and my framework is that the fed doesn't need a lot to hike. i think where we are right now more or less if this idea of something of a modest set back happens in the second quarter and even if we remain at this 2.25 or 2.5% growth rate that is enough for the federal reserve. i think some people think that we have to have this massive snap back and quickly i think the bar is low for the fed to do this. they want to do this. i think they're going to do it this year. >> we have to jump in right now because lumber liquidators have some news. the stock down in the premarket and the company's ceo robert lynch unexpectedly announcing that he is notified the company of his resignation as the company's president and chief executive officer. the company in a statement says it intends for a national search

and the company's founder will serve as the acting chief executive officer. bu, of course, chis this comes amid, the story start would 60 minutes. they're in the midst of a crisis and then, of course you have to wonder what he knows or doesn't know. >> the one thing he has done is stand very firmly. he's been very adamant in all of his statements to date saying none of these charges were true and none of this had any backing or fact behind it. this company in the press release looking very quickly does not say why he is stepping down. he says that he unexpectedly notified the company automatically that is leading people. >> the word unexpectedly is the, companies just don't do that. i think when you say unexpectedly, i don't want to say you're indicting the company. there is something amiss in a very bad way. >> we're in the 5s. $500 range right now at 19. it's going to be a microcap by the end of the day, maybe.

>> we should also say that the company is announcing john pressly, the company's lead independent director will become the nonexecutive chairman and the board of directors accepted mr. lynch's resignation as a director of the company. and mr. sullivan saying i'm really proud of the team and i look forward to working with them and providing our customers with the best hardwood floors and the best prices. >> it's a very brief, three paragraph press release. leaves a lot of questions to be answered and of course that is a huge reflection on what's happening. >> i don't remember the company saying it's unexpected. we can say it's unexpected. but when the company says it's unexpected. >> possibly you're watching something play out that you look back at it and say we should have done probably after the "60 minute" thing. maybe. i don't want to get sued for saying that. that is what is in the back of everybody's mind. >> that's what is reflected. >> it's down from $85 and it's at $25 and going to open at 19.

i mean how much can shareholders lose now? that's the only good thing. they can only lose $500 million more. what is that an eighth of a point on apple. >> it's like -- >> well look the problem that comes with this. >> $500 million. you know. >> obviously, people will be waiting to hear from thomas sullivan, the founder to see what he has to say and what his plans are to leave the company. >> it wouldn't be possible if there was possible misconduct. malfesance. remember potter? >> mr. potter. >> the ceo is gone. we'll watch that stock ahead of the market open and also try to dig into this and see if we can understand what is taking place behind the scenes though. when we return from a late-night writer in the late '80s to taking charge of letterman's worldwide pants production rob burnett has produced critically acclaimed programs and worked on the longest running show in history. take a look at letterman by the numbers. "squawk box" returns in just a moment.

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the last six weeks it's been crazy. people have been saying lovely things about us. and it's really been over the top. and i can't tell you how flattering, embarrassing and

gratifying it has all been. in light of all of this praise merited or not, do me a favor. save a little for my funeral, all right. i'd appreciate it. that is all i got. the only thing i have left to do for the last time on a television program, thank you and good night. >> that was a clip from last night's final episode of "late show" the now retired david letterman has hosted 6,000 show os featuring 19,000 plus guests and no less than 4,605 top ten list and the man by his side for most of this late show executive producer since 1996 rob burnett. great to have you here. >> thanks for having me. this is fantastic. it's okay. very nice. let me just start because our show is off the air. we'll get to that. but we all know what the best show on television is right here. and you know why. you know why. because it's not about the

finances. it's a soap opera. that's how you have to watch this show. it's simple. and here's what you, yes, last time i was on i said you were just watching to see if he punches you. its arer be erbeyond that. she's not going to break it up. >> we may do the -- >> she wants this to happen. >> we may do the boxing match. >> here's what's going on here. it's deeper than that. this is a successful man. look at him. look at him. there's one thing. you know what's missing? he just wants you to love him, joe. >> don't you know there is a fine line between love and hate. >> i don't think it will ever happen. >> once you admit the love then sometimes he's looking at me and i'm looking at him. who knows what happens at that point. i worry about the universe ending when that happens. how are you a faithful viewer of this show when you get done so

late? >> they tape it. >> that's right. but then he goes out with the after party. >> we're out every night to 2:00 a.m. me and clooney. every night. thanks for having me. it's a pleasure to be here. >> thank you for being here. and this has to be strange because we know you've been the executive producer since 1996 but you were an intern in 1985. >> 29 years, august would have been 30. but what's amazing about it is you look on the credits and i'm like i think, 16th in tenure there and everywhere you turn. so it was a very odd day yesterday for all of us because you look and this person has been there 20 years and this person 30 years and on and on and on. so, it was, it was a strange, surreal and emotional day for us yesterday. >> what do you do on tuesday after memorial day? >> do you have yard work that you need done? i'm available. well, the funny thing about the

ironic thing is everyone said what are you going to do on the thursday and i said, i don't know what i'll be doing but i know i'll be sleeping in. thanks a lot. you guys ruined that. >> go back to bed after this. >> thank you. >> i want to know what you think about -- 30 years and late night television. what was it like when you started? what's happened since then? what do you think about the changes that have come? >> it's changed tremendous since i began. the biggest television of course, is changing in general. but late night, in particular, has changed because of the technology more than anything. because late night, it used to be when i was a kid you'd watch johnny carson and spend an hour with johnny eandand then dave came on and spend an hour and now it's not about spending that hour. now it is about go on youtube and it's about the highlights. it's not about the full hour. and it's it's different. i think as all the guys now are

great. fallon steven colberf,t, i don't think -- i don't think these shows will ever quite be the same. >> has the industry become so fragmented that you could never reproduce another carson or letterman? >> i don't think so. johnny's show routinely used to get numbers that were you know 60 or 65%, 70% of the people watching television were watching johnny carson. i don't care how good you are, that will never happen again. so it's different. and i think with dave leaving, it really is the end of an era of othat kind of show. >> that was our goal for the mornings. 60 to 70. we need to ratchet that down i think. >> our expectations. >> 60 to 70%. we're still scrambling to get that. we're not, you don't see that. >> it's not impossible. it's not impossible. >> you think the day we finally -- >> we have to hug it out.

>> i would take my shot with the punch. if you're going for a 70 share. >> yeah. but he's got a point. once you hug, then the next day, it's over. but no one is watching any more. >> we have to continue this. do we have any liberal -- >> here we go. here we go. >> nice. >> any "new york times" talking points from the meeting? >> you want me to comment on mr. letterman. >> i like that chris matthews said he had no idea what dave's politics were. that were -- how would chris know. pp. no one has any idea what his politics are. >> that's an interesting thing. i can tell you when i was head writer. >> there was a long time when i never, i never talked politics with dave. he says he's an independent. and i'll take him at his word for that. there was a time legitimately when i was the head writer of the show that i really did not know which side he was on.

if there was a republican in the white house, we'd also get letters, oh, you're doing the jokes and then same in reverse. i think as dave has gotten older, he's been more vocal about issues that he cares about. that, again, we haven't spoken about. they clearly seem to line-up with, you know a little bit more towards the left. >> we'll see. >> colbert. what do you think? dwl >> i think he's great. i know steven personally and i think he's a very very funny smart guy. i think he'll do fantastically well. >> he's got, we don't know him. we don't know him. >> you know it's not a far walk away from the character. >> you know how long it took al bundy to become the guy on "modern family." it took him like 30 years. he was a detective for a while and he's al bundy. yeah. until, it took 30 years to get out of that. >> steven if you're looking, joe called you al bundy.

i'm going to need tick toots that to that show. >> can you tell us some of the inside dirt. who was your favorite guest that you ever had? >> my favorites probably were becky, of course. >> thank you, thank you. >> bingo. >> i saw you flailing for a second. i thought you were having chest pains. >> there she is. isn't that a moment. >> there is a moment. >> you were a great guest. you know julia roberts is one of my favorites. tom hanks, bill murray howard stern. steve martin. generally the people that come to play ball with us are fantastic. >> what about the moments. the drew barrymore moment or a madonna moment. >> one of my favorite. >> one of my favorites was when farrah fawcett was on. did you ever see that? she completely kind of was in

her own world. let's just say that. >> i remember that. >> but here's the thing that no one knows. so she came on and she came late. and the show was going on while she wasn't there. so i had no particular insight into her performance because i was watching it like everyone else and then i was asked about it and i thought, well i'll do the chivalrous thing and people say, was she on drugs? the next day i was in my office at 11:00 at night and the phone rang and it was farrah and i thought she was calling to thank me. she was calling to explain what it was she was doing on the air. and i can tell you, that hour that i was on the phone with farrah was more confusing than whatever was on the air. the only thing i can recall is she kept saying i'm going to al pacino's castle. that was the phrase she kept saying. here's the part you realize your life has changed. i'm 52. you do the math. i was, i don't know 14 15 16

when the big farrah poster -- >> with the two, right. >> right. >> enough said. and if i ever could have looked in a crystal ball and thought, i'm going to be in my office at 11:30 at night talking to farrah fawcett alone and all i'm going to want to do is get off the phone. i would have thought, what happened to me? it's sad. but, anyway. it's been a great run. a lot of fun stuff. i feel very lucky to have worked with dave. he is the funniest guy alive. if you're a comedy guy and you like all of that stuff, you feel yourself getting better every second you're with him. >> will you guys do anything in the future? not on the air but produce other stuff together? >> we're talking about it. i actually wrote and directed a movie that i'm editing now which is a worldwide production. dave and i have not had a lot of conversations about what it is he wants to do next. i think the world is his oyster.

he's a brand. i think he's got to figure it out. >> do you think he wants to do something or does he want to hang out? >> i don't know. i think he'll probably take a little time. all of us. we've been running in a little hamster wheel. i think we all need a moment to figure it out. then he has a very active mind with a lot to say. whatever he decides will be interesting, i think. >> what's the film? i knew you were working on it last summer. >> it's based on a small book called the revised fundamentals of caregiving. it stars paul rudd. we shot in atlanta. we'll see. it's still early. if you'll have me on i'll come back. >> come back and talk about it. >> i must say financially i have nothing to worry about. i put everything i had six months ago into lumber liquidit aors.

i'm relaxed. nothing to worry about for me. >> he had great guests. who is our great guest? you know what i come up with? >> robert burnett. >> this is how show business works. we lie about each other. i'm going to miss the lying more than anything else. >> i struggle when people ask me. richard simmons was hilarious and fabio was so freaking good looking, they may be -- >> right up there. >> i may have a meeting with your bookers. >> best show on tv. >> you can stop lying now. >> no. i love it. it's a family. then you've got that crazy, the other guy? rick? he's nuts. >> you know how many people you could have been talking about when you said the other guy that's crazy. >> i love that. it looks like he's eaten expired

yogurt. i never understand anything he says but i listen. the five and ten year doing the tango. i call my guy, sell everything. i don't know what it means. >> rob, come back. >> i love it here. thanks for having me. >> when we return jim cramer -- i thought you meant is crazy, from the new york stock exchange. can it make a dentist appointment when my teeth are ready? ♪ ♪

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mcdonald's holding a shareholder meeting today. investors are going to be voting on a proposal to make it easier to nominate directors to the board. these are live pictures outside that meeting where protesters are gathering. they want the restaurant chain to increase wages for front line workers to $15. we go to new york stock exchange and jim cramer. we got this lumber liquidator news. >> mcdonald's has to win over the franchisees. lumber, how could that guy stay in his job? this thing is falling apart.

everyone thinks this company could literally, i don't want to say disappear, but fade. salesforce, this is the most combative i ever heard. he showed you the company can be amazingly profitable. he buries sap. this was how they would kill sap, grow $10 billion in revenues and making a lot of money. it was the feistiest i ever heard him. bill mcdermott. mark said until we get to $10 billion, until we get to where we want to in terms of passing sap, he doesn't want to sell. >> we'll see you in a couple of minutes.

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and start working on your next big idea. ♪ ♪ welcome back. let's take a look at what's happening. yesterday you saw the stock market down slightly. this morning that trend continues. dow futures down 20 points. s&p down by three and nasdaq

down by nine. at the bond market it's yielding for the 10 year 2.246%. you see the dollar is down across the board. dollar at 1.11 to the euro. that does it for us today. join us tomorrow. right now it's time for "squawk on the street." good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber at the new york stock exchange. a big diet of news. earnings from best buy, salesforce, $12 million health care deal. bullish calls on netflix and apple. oil steady around $60. ten year steady around 2.25. claims continue to come in low. a lot of global pmis were mixed.